SEC revokes Eco Hatchery’s registration for Ponzi-like scheme

THE Securities and Exchange Commission (SEC) has ordered the revocation of Eco Hatchery and Trading Corp.’s certificate of incorporation and registration as a corporation for offering an unauthorized investment scheme similar to a Ponzi scheme.

“The marketing and/or compensation plan of Eco Hatchery shows that its main strategy is to earn from recruitment, although presented in the guise of running a prawn, shrimp, crab, and fish farm,” the commission said.

The stock corporation’s primary purpose as stated in its articles of incorporation is to engage in the business of seafood and fishing production, as well as own and develop fishponds, fish culturing, and salt production.

Eco Hatchery was offering the public a program that guarantees a profit of 15% every 15 days over the course of four months. Investors are promised to earn with an initial investment as low as P500.

According to the records of the commission, the company is not licensed to collect investments from the public because it did not secure an SEC registration nor a license to collect investments.

Eco Hatchery’s investment activities were first brought to the SEC’s attention in July 2019.

In September 2019, the commission’s Enforcement and Investor Protection Department (EIPD) conducted an ocular inspection and surveillance operation at Eco Hatchery’s office stated in the company’s Facebook posts, which was found to be consistent with the address provided in its articles of incorporation.

“Upon inspection, the EIPD team was informed by the security guard at the lobby that Eco Hatchery occupied the said office but was closed at the time,” the SEC said.

Eco Hatchery also did not have a business permit from Barangay Philam in Quezon City.

The SEC issued a public warning against the company in February 2020, and reported that Eco Hatchery “did not bother to react, much less refute the issued advisory against it.”

A show-cause order was issued at the end of the month against the company and its stockholders, directors, and incorporators, namely: Jose Marie Baquiran, Symphony S. Mondragon, Abner A. Pacheco, Lorenzo N. Mendez, and Stephen R. Cervantes.

The named company officials were found to have provided fake addresses in Eco Hatchery’s articles of incorporation.

“The same constitutes fraud in the procurement of registration,” the SEC said.

When the SEC’s EIPD team revisited Eco Hatchery’s office to issue the show-cause order, the team was informed that the tenant company had moved out of the building.

The commission in its issuance said Eco Hatchery’s activities “[constituted] serious misrepresentation.”

Eco Hatchery’s corporation status in the online database of the commission has since been labeled as “revoked” to align with the order. — Keren Concepcion G. Valmonte